The U.S. Department of the Treasury is calling for business to report cryptocurrency transactions worth more than US$10,000 to the Internal Revenue Service.
Fast Facts:
- A report released by the U.S Treasury Department on May 20 on tax proposals for President Joe Biden’s Americans Families Plan calls for businesses, including banks and cryptocurrency exchanges, to report more information on crypto inflows and outflow in their annual accounts, starting in 2023.
- The proposed requirement targets transfers worth US$10,000 or more. The Treasury report highlighted cryptocurrencies and cash as potential methods to hide income from the government.
- “Despite constituting a relatively small portion of business income today, cryptocurrency transactions are likely to rise in importance in the next decade, especially in the presence of a broad-based financial account reporting regime,” the Treasury report said.
- At present, the IRS has no independent means of verifying crypto transactions, potentially leading to a widening tax gap between taxes owed and paid.